Capitalism and democracy are mentioned in broad generic terms. Chua sees them as desirable complements, but she faults American foreign policy for considering them in terms of

ideological battles—Capitalism versus Communism, Democracy versus Authoritarianism, the “Free World” versus “the Axis of Evil”—[that blind us to] more primal group identities, which for billions are the most powerful and meaningful, and which drive political upheaval all over the world.

To illustrate, she quotes President George W. Bush’s comment that “freedom and democracy will always and everywhere have greater appeal than the slogans of hatred.” Remaining bipartisan, she also quotes President Barack Obama’s “unyielding belief”

that all people yearn for certain things: the ability to speak your own mind and have a say in how you are governed; confidence in the rule of law and the equal administration of justice; government that is transparent and doesn’t steal from the people; the freedom to live as you choose. Those are not just American ideas, they are human rights, and that is why we will support them everywhere.

Chua’s fundamental argument is that the “great Enlightenment principals of … liberalism, secularism, rationality, equality, free markets—do not provide the type of tribal group identity that human beings crave and have always craved.”

After applying her views on the emotional appeal of tribal identities internationally, she focuses on the influence of tribalism in American politics in her last three chapters, including her epilogue. For example, without completely dismissing the influence of Occupy Wall Street, she sees it as a failure because it “attracted so few members from the many disadvantaged groups it purported to be fighting for.” Instead, “the participants of Occupy were not the hungry or exploited, but rather relatively privileged self-identified activists … [and] Occupy offered a meaningful tribe to such people.”

Among other interesting, and often frightening, implications of political tribalism in America that she considers, some of the most troubling deal with identity politics. For example, after quoting the New Yorker that the Woman’s March of January 21, 2017 was “ ‘so radiant with love and dissent, that’ the ‘coming together’ of all marginalized groups ‘seemed possible,’ ” she adds some realism by pointing out that “below the surface, however, political-tribe tensions plagued the march.” She explains the tensions (and insults) the “radiant love” motivated between black and white women, as well as other provocations between other tribes, shouldn’t be surprising given negative-sum competition motivated by identity politics.

The book focuses on politics rather than economics, but public choice economists will connect Chua’s discussion to related insights. To me her book indicates why a sound economic argument that economists routinely make to criticize government policies is commonly unpersuasive.

Ethnically oblivious / In her opening chapter on “American Exceptionalism,” Chua chronicles America’s deficiencies in matters of race. She makes the paradoxical argument that “what’s so peculiar about America [is that] we have been both exceptionally racist and exceptionally inclusive.” She quotes President Woodrow Wilson’s statement that “you cannot become thorough Americans if you think of yourself in groups. America does not consist of groups” (Chua’s emphasis). She recognizes that Wilson was a hard-core racist and sees his statement as “remarkable not only because of how false it was, but also because of how much truth it holds, at least for certain major segments of the population.” “Even today,” she admits “the aftereffects of slavery still haunt America in the form of systemic inequality and injustice.” Yet she sees in a “seemingly contradictory way … [that] through the alchemy of markets, democracy, intermarriage, and individualism, … America has been uniquely successful in attracting and assimilating diverse populations.”

It seems natural for Americans to ask, if “immigrant communities from all sorts of background have become ‘Americans’; why wouldn’t Sunnis, and Shias, Arabs, and Kurds all similarly become ‘Iraqis’ ”? Our ability to overlook tribal differences is rooted in some of America’s “noblest ideals: tolerance, equality, individualism, the power of reason to triumph over irrational hatred, and the conviction that all men are united by their common humanity and love of liberty.” Unfortunately, it also “predisposes us to ignore ethnic, sectarian, and tribal divisions in the countries where we intervene.”

Chua closes out this chapter by highlighting one “successful” intervention that soon became a disaster that U.S. State Department officials wanted to forget. In the glow of “success” after toppling Libyan strongman Muammar Gaddafi by a U.S.-led coalition in 2011, President Obama declared, “One thing is clear—the future of Libya is now in the hands of the Libyan people…. It will be the Libyans who will build their new nation.”

Market-dominant minorities / Chua’s first detailed discussion of the failure of U.S. foreign policy concerns the Vietnam War. People still debate how America, with the most powerful military on the planet, managed to “lose to what Lyndon B. Johnson called ‘a piddlying pissant little country.’ ” Chua’s answer is “millennia-old ethnic conflict” and “political tribalism.”

Without attempting a detailed account of her discussion of each American foreign-policy blunder in the book, it is useful to describe a common condition in developing countries, the ignorance of which helps explain many of those blunders. The condition is “market dominant minorities,” a term Chua coined in 2003. The term describes a situation in which

an ethnic minority tends, under market conditions, to dominate economically, often to a startling extent, the poor “indigenous” majority around them, generating enormous resentment among the majority, who see themselves as the rightful owners of the land under threat from “greedy” exploitative outsiders.

Market-dominant minorities “include Chinese throughout Southeast Asia, Indians in East Africa and parts of the Caribbean, Lebanese in West Africa and parts of the Caribbean, … whites in South Africa, whites in Zimbabwe, whites in Namibia, Croats in the former Yugoslavia, Jews in post-Communist Russia, … —[and] the list goes on.” In these and other examples, “intense ethnic resentment is almost invariable, leading frequently to confiscation of the minority’s assets, rioting, violence, and, all too often, ethnic cleansing. In these conditions, the pursuit of unfettered free-market policies makes things worse.”

If those conducting American foreign policy during the Vietnam War were aware of these “ethnic realities,” there’s no evidence of it. The portion of the $100 billion–plus the United States spent on the war that reached the local population “ended up wildly disproportionally in the pockets of the ethnic Chinese,” the market dominant minority of Vietnam.

The blunders created by the U.S. invasions of Afghanistan and Iraq are also illuminated by the ethnic realities in those two countries that were largely ignored, at least initially. Chua provides an interesting explanation of the success of the 2007 surge in Iraq as “a concrete example of what a more effective, tribal-politics-conscious U.S. foreign policy might look like.” She doesn’t explicitly mention market dominant minorities in her chapters on Afghanistan and Iraq, or in her following chapter on terrorism, but it is implicit in her emphasis in these chapters on the tribal satisfaction humans receive from dehumanizing outsiders and engaging in savagery that few of us would consider when acting alone.

A market dominant minority plays a clear role in Chua’s chapter on Venezuela and the political success of Hugo Chavez. The chapter begins with an interesting discussion of feminine beauty, which arguably is Venezuela’s most prominent industry after oil. Featured is Irene Saez, a Miss Venezuela who went onto win the Miss Universe title. Like all Miss Venezuelas up to that point, she was “light skinned with European features, bearing little resemblance to Venezuela’s darker skinned masses … [which make up] the vast majority of the country’s population.” In 1998, the year Chavez was elected, “it was inconceivable [both in Venezuela and the U.S. State Department] that a person with Chavez’s complexion and ‘African’ features could become Miss Venezuela or the country’s president.”

Why did Chavez win? Because it was an election between “Venezuela’s dominant ‘white’ minority and its long-degraded, poorer, less educated, darker-skinned, indigenous- and African-blooded masses. Even today, partisan finger pointers in the United States have little understanding of the origins of the autocratic havoc now engulfing the country.” Maybe those finger pointers didn’t realize that Chavez’s opponent when he won the presidency in 1998 was the former Miss Universe, Irene Saez.

An important issue that Chua does not consider when discussing market dominant minorities is whether the poor are made better off by government policies that harm those minorities by imposing government restrictions on markets for the stated purpose of helping the poor. In Venezuela, for example, the rich were creating wealth for the most part through market activity. Though that wealth was distributed far less equally than in the United States, it still provided more benefits to the poor than the economically destructive policies of Chavez (and now his hand-picked successor, Nicolás Maduro) even when considering the short-run benefits the poor received from government transfers. Yet it is surely true that many of the poor still have strong tribal affection for Chavez because of his resentment and ridicule of the market-dominant minorities they felt had stripped them of their wealth and dignity.

The bitter angels of our nature / In her last three chapters, Chua turns her attention to tribalism in America. The message is that it doesn’t take social gaps as large and rigid as those existing in many poor and developing countries to spawn political tribes. And those tribes can motivate emotions that render politically irrelevant the question of whether harming the wealthy helps the poor or hurts them.

In some respects, Chua’s argument in Chapter 7, “Inequality and the Tribal Chasm in America,” is puzzling. First, she states that

inequality is fracturing our nation. But just as America’s foreign policy establishment repeatedly fails to understand the group realities that matter most to people abroad, America’s elites have been blind to—or dismissive of—the group identities that matter most to ordinary Americans. If we want to understand our current political turmoil, we need to open our eyes to the vastly different group identities of America’s rich and poor.

Are there really many Americas who haven’t heard about income inequality in America? Obama did his part to “open our eyes” by claiming “the defining challenge of our time” is growing income inequality and a lack of upward mobility. Few issues have been more effectively used in recent years to justify identity politics. The result has been more people being treated as members of victimized groups, with “social justice” requiring government programs and regulations directing attention and benefits on such groups, supposedly at the expense of the privileged. The problem Chua sees is “that the groups America’s have-nots belong to are often ones that elites view as antisocial, irrational, or even contemptible, if they even know about them at all.” Unfortunately, identity politics is more likely to tear us apart than to bring us together in ways that Charles Murray recommends in his 2013 book Coming Apart.

So is it inequality that is “fracturing our nation” as Chua indicates, or is it the political response to inequality that rewards the formation of tribes in ways that foment resentments and scorn between them? No doubt, both have worked together to explain the “tribalism in America [that] propelled Donald Trump to the White House.” She obviously understands the problems with tribalism, yet believes we have “to acknowledge the impact of inequality and the wedge it has driven between America’s whites.”

Whatever one blames for tribalism, no one can deny it exists and is motivating additional tribalism. According to Chua:

The Left believes that right-wing tribalization—bigotry, racism—is tearing the country apart. The Right believes that left-wing tribalization—identity politics, political correctness—is tearing the country apart. They are both right.

Yet, she doesn’t believe the “United States is in … immediate danger of actually breaking up.” Hopefully she is correct. There is always an element of anger and contempt reflected in political debate, and American politics is no exception. But few would deny that the anger and contempt in political discourse has increased along with the growth in identity politics. Chua recognizes that identity politics is a product of both the Left and the Right, and the result is increased hostility between groups fighting for political advantage with complete confidence in the righteousness of their demands.

Unfortunately, those who see themselves fighting for righteous causes invariably also see themselves as facing evil enemies, with justice requiring harming those enemies even at the expense of harming themselves. As Chua points out,

In recent years, whether because of growing strength or growing frustration with the lack of progress, the Left has upped the ante. A shift in tone, rhetoric, and logic has moved identity politics away from inclusion—which had always been the Left’s watchword—toward exclusion and division.

Exclusion and division harm everyone, including those promoting exclusion and division. She contrasts this with Martin Luther King’s ideals, “the ideals that captured the imagination and hearts of the public and led to real change—transcended group divides and called for an America in which skin color didn’t matter.” The heartland supporters who propelled “Trump to the White House” were reacting against the “Coastal elites” whom the heartlanders see as “a kind of market dominant minority” who rig the economy against them and dismiss them as deplorable. The result is a level of resentment that justifies harming the elites even if it means also harming the heartlanders with trade restrictions.

There is nothing new about “cutting off one’s nose to spite one’s face,” and people are quite capable of such self-inflicted harm when acting out of anger and resentment as individuals. But there can be no doubt that tribal anger and resentment are particularly dangerous when people act politically. Political action greatly reduces the sense of individual responsibility and cost of going along with a crowd to harm others even if it means harming one’s self.

Political action makes it more likely that we will yield to the urging of the bitter angels of our nature, who tempt us more than we like to admit. Those angels, I suspect, explain why economists have been less persuasive than we wish when emphasizing the negative-sum consequences of government policies.